Credit Condition Survey

The Credit Condition Survey was conducted between January and March of 2019. The questions were fact-based and focused on financing sought by small enterprises (1 to 99 employees) during the 2018 calendar year.

A total of 1,877 small businesses completed the questionnaire. This is the second largest Canadian survey on small business financing. The margin of error is 2.3% for questions addressed to all respondents. R.A. Malatest & Associates administered the survey for Innovation, Science and Economic Development Canada.

The following tables present the key statistics from this survey.

Table 1: Request Rates, Approval Rates and Average Amounts Authorized, 2018
Type of Financing	Request Rate	Approval Rate^{Footnote *}	Average Amount Authorized
Debt Financing	27	83	$268,000
Leasing	9	96	-
Equity Financing	3	-	-
Trade Credit	6	-	-

Table 2: Debt Financing (Long Term versus Short Term), 2018
Type of Debt	Request Rate	Approval Rate^{Footnote *}	Average Interest Rate	% Collateral Required	Average Amount Authorized
Long Term^{Footnote 1}	15	79	4.9	79	$400,000
Short Term^{Footnote 2}	20	83	6.2	47	$194,000
Overall	27	83	5.7	55	$268,000

Table 3: Debt Financing By Enterprise Characteristics, 2018
Enterprise Characteristics	Request Rate	Approval Rate^{Footnote *}	Average Amount Authorized
Number of Employees
1 to 4 employees	23	78	$118,000
5 to 9 employees	26	90	$417,000
10 to 19 employees	34	87	$289,000
20 to 99 employees	36	78	$322,000
Region
Atlantic	31	81	$185,000
Quebec	35	80	$231,000
Ontario	25	84	$370,000
Manitoba-Saskatchewan	30	95	$232,000
Alberta	26	78	$277,000
British Columbia & Territories	22	81	$173,000
Industry
Accommodation and Food	29	85	$114,000
Construction	29	87	$199,000
Manufacturing	27	84	$190,000
Agriculture and Fishing, Forestry, and Oil and Mining	29	89	$412,000
Professional Services	24	78	$163,000
Transportation/Warehousing	31	79	$143,000
Retail and Wholesale	29	89	$245,000
Age of Business
3 years old or younger	47	81	$154,000
4 to 10 years old	28	74	$120,000
More than 10 years old	27	81	$311,000
Exporting Activities
Exporter	32	73	$672,000
Non-exporter	28	84	$194,000
Innovation
Product	33	74	$156,000
Process	33	77	$281,000
Organizational	34	79	$161,000
Marketing	37	72	$132,000
Innovator^{Footnote **}	32	76	$209,000
Non-innovator	23	90	$184,000
Gender of Majority Owner
Male	27	80	$329,000
Female	28	88	$129,000
Jointly Owned	30	87	$144,000
Education Level of Majority Owner
Less than high school	32	80	$160,000
High school diploma	25	84	$576,000
College/Cegep/Trade school diploma	28	87	$194,000
Bachelor Degree	31	74	$224,000
Masters Degree or above	24	88	$163,000
Experience Level of Majority Owner
< 5 years	47	88	$227,000
5 to 10 years	32	83	$116,000
> 10 years	26	82	$305,000
Age of Majority Owner
Younger than 40 years old	28	84	$238,000
40 to 49 years old	29	85	$132,000
50 to 64 years old	29	79	$209,000
65 years old or older	21	91	$683,000

Table 4: Main Reason for Not Seeking Financing, 2018
Reason	%
Financing not needed	85
Unaware of financing sources	2
Thought the request would be turned down	4
Applying for financing too difficult or time consuming	4
Cost of financing too high	5
Other reason	2

Table 5: Main Intended Use of Debt Financing, 2018
Intended Use	%
Fixed asset	32
Working/Operating capital	51
Research and development	1
Debt consolidation	7
Enter a new market	4
Other use	6

Table 6: Sale Destinations, 2018
Destination	%
Local municipality or region	76
Rest of province/territory	16
Rest of Canada	4
Rest of the world	4

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Credit Condition Survey - 2018